Singapore and India have recently intensified their efforts to develop a joint semiconductor ecosystem aimed at creating resilient supply chains and advancing technological capabilities in this critical sector. 

This cooperation is part of a broader strategic partnership, elevated during Indian Prime Minister Narendra Modi’s visit to Singapore in September 2024, underscoring the mutual commitment to deepen collaboration in semiconductors among other sectors like digital technologies, healthcare, and skills development.

The collaboration between the two countries is formalised through a Memorandum of Understanding (MoU) signed by India’s Ministry of Electronics and Information Technology and Singapore’s Ministry of Trade and Industry. This MoU establishes a comprehensive framework for bilateral cooperation aimed at leveraging Singapore’s mature semiconductor ecosystem and technical expertise to bolster India’s ambition of becoming a global semiconductor manufacturing hub.

Singapore, which accounts for about 11% of the global semiconductor market and contributes roughly 8% to its GDP from the semiconductor sector, is highly experienced across the semiconductor value chain—from integrated circuit design to wafer fabrication, assembly, testing, and packaging.

India’s semiconductor ambitions complement Singapore’s capabilities. India currently has significant competence in semiconductor research and design, with a strong presence of global chip-design firms and growing start-ups developing semiconductor intellectual property (IP).

However, India’s manufacturing and fabrication segments are still nascent, with dependency on external sources for advanced chip production and testing. The partnership aims to catalyse private sector collaborations, encouraging business-to-business engagements to build domestic manufacturing capabilities—particularly in assembly, testing, packaging, and eventually wafer fabrication.

This cooperation is strategic for both countries. Singapore can extend its know-how in semiconductor manufacturing, quality infrastructure, and workforce skill development to India, helping to address gaps in advanced node chip production and high-end logic chip capabilities.

For India, tapping into Singapore’s advanced semiconductor ecosystem fills critical technology and infrastructure gaps, accelerating its semiconductor ecosystem growth and reducing reliance on fragmented global supply chains. The partnership also aims to increase supply chain resilience to global economic uncertainties by diversifying sources and reducing susceptibility to disruptions.

On the Indian side, the semiconductor industry is poised for significant growth, with a market projected to reach $63 billion by 2026. The government has announced a $10 billion incentive package and approved construction of semiconductor plants worth over $15 billion focusing on sectors like defense and telecommunications.

Singapore’s participation enhances India’s strengths, especially as India pushes to expand beyond chip design into front-end manufacturing and back-end processes like assembly, testing, and packaging (ATP).

The collaboration is not limited to manufacturing but also spans policy exchanges, joint skill development programs, and workforce training centres, including Singapore’s establishment of a training center in India focused on maintenance, repair, and overhaul capabilities. This aspect is crucial for building local expertise to sustain a globally competitive semiconductor industry.

In the long term, the partnership is expected to tap into emerging markets such as electric vehicles (EVs), artificial intelligence (AI), and generative AI technologies, which demand advanced semiconductor chips. India’s growing automotive and AI markets provide fertile ground for joint innovation and production, while Singapore’s experience supports development of advanced manufacturing and sustainable practices in semiconductor production.

The India-Singapore semiconductor ecosystem partnership represents a significant step toward building a more resilient, diversified, and advanced semiconductor supply chain in the Indo-Pacific region, strengthening economic security for both nations and contributing to the global semiconductor industry’s stability and growth.

The partnership exemplifies how combining complementary strengths—India’s large market potential and technical workforce with Singapore’s advanced semiconductor ecosystem and manufacturing expertise—can accelerate semiconductor development and reduce vulnerabilities in critical technology supply chains.

IDN (With Agency Inputs)